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You are trying to decide between two mobile phone carriers. Carrier A requires you to pay $210 for the phone and then monthly charges of
You are trying to decide between two mobile phone carriers. Carrier A requires you to pay $210 for the phone and then monthly charges of $60 for 24 months. Carrier B wants you to pay $115 for the phone and monthly charges of $64 for 12 months. Assume you will keep replacing the phone after your contract expires. Your cost of capital is 4.3%. Based on cost alone, which carrier should you choose?
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